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Telecom Revenue Forecast: Sunny with Cloud Cover

March 4, 2011

The U.S. telecommunications sector, which endured a revenue decline in 2009 due to the struggling economy, is on track for steady growth, with spending projected to climb from $985 billion in 2010 revenue to $1.2 trillion in 2014. That's according to a preview of the Telecommunications Industry Association's 2011 Market Review and Forecast, obtained by Tech Daily Dose.

The complete version of the annual report assessing the communications marketplace will be released in mid-March. TIA projects that the biggest revenue gains will occur globally due to the rapid expansion of telecom services in the Middle East, Africa, Asia and Latin America. Worldwide telecom spending (excluding the U.S.) is set to expand from $3.1 trillion in 2010 to $ 4.1 trillion in 2014, the report estimates.

A major area of growth will be in cloud computing, though some of the gains will be offset by declines in hardware purchases, since companies will be able to shift more of their operations to the Internet, the preview says. Despite the rosy forecast, stormy weather is ahead in the form of capacity shortages for communications networks, though the constraints could result in increased spending on infrastructure. And with rates for broadband service on the rise, growth in subscriptions could slow, though overall revenue for high-speed Internet service is expected to remain stable.

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